Kim Joo-hyun, Financial Services Commission Chairman, "Will be unveiled within the first half of the year"
A comprehensive platform for low-income finance, which allows users to inquire about various policy and private low-income financial products, execute loans, and even conduct complex consultations through a single application, will make its debut this June.
On the morning of the 5th, Kim Joo-hyun, Chairman of the Financial Services Commission, visited the Central Low-Income Finance Integrated Support Center in Jung-gu, Seoul, held an on-site meeting, and announced that the low-income finance comprehensive platform 'Seomingeumyung Itda (tentative name)' will be launched within the first half of this year. This is the first improvement task of the Financial Services Commission's 'Low-Income Finance Efficiency Plan,' which includes a demand-centered policy low-income financial product and system reform.
On the 27th, citizens visiting the Jung-gu Central Microfinance Integrated Support Center in Seoul applied for loans from a small living expense loan product offering up to 1 million won with an annual interest rate of up to 15.9%. Photo by Kang Jin-hyung aymsdream@
The comprehensive platform Itda will allow users to integrate and view policy and private low-income financial products in a customized manner, and before applying for policy low-income financial products, it will prioritize guiding private products with favorable conditions such as interest rates and limits.
The loan process will also become simpler. By promoting the introduction of public MyData, personal information such as income and employment details can be provided without separate manual input. When using policy products, the issuance of guarantees will also be conducted in a one-stop manner.
Additionally, when issuing guarantees, details of financial companies capable of executing loans will be provided collectively. Currently, for direct guarantee products of the Korea Inclusive Finance Agency, after issuing a guarantee, borrowers must visit the branches or apps of contracted financial institutions separately to check approval status. However, with Itda, after guarantee issuance, the loan approval status of financial companies will be collectively checked to help users easily find financial companies that can approve loans.
The authorities plan to expand the number of private products, currently limited to nine (nine Sae-hope Holssi products and one Sa-itdol loan), to more than 20. To this end, they are pushing to reduce the loan linkage fees that financial institutions pay to the Korea Inclusive Finance Agency from 0.5?1.0% to 0?0.5%, and will strengthen incentives by reflecting this in the Financial Supervisory Service’s evaluation of banks’ support activities for low-income finance.
On the comprehensive platform Itda, not only inquiries and applications for low-income financial products but also complex consultations linking welfare, employment, and debt adjustment services will be provided non-face-to-face. Until now, complex consultation services have been provided mainly face-to-face (small livelihood loans), even though 27.9% of policy low-income financial product users are unemployed or in unstable employment sectors (non-regular workers, daily workers, etc.).
Post-management support will also be strengthened. On the comprehensive platform Itda, a customized post-management support function will be newly established to prevent the occurrence or prolongation of delinquencies in advance according to the user’s debt repayment status. If signs of delinquency occur, such as a significant drop in personal credit evaluation (CB) scores, loan delinquencies at other institutions, or excessive use of credit cards relative to limits, financial education on resolving delinquencies and credit management, as well as credit and debt management consulting, will be provided.
Chairman Kim said in this regard, "I ask for special cooperation to ensure the successful implementation of low-income finance policy directions," and added, "We will continue to promote the efficiency of products and operational systems so that users of policy low-income finance can conveniently find products that best suit them among the complex and diverse low-income financial products."
Meanwhile, while preparing to launch the comprehensive platform Itda, the authorities plan to soon prepare and announce measures to strengthen complex consultations for low-income finance efficiency. Chairman Kim stated, "To fundamentally solve the difficulties of vulnerable groups, supporting economic self-sufficiency is most important beyond financial support. Therefore, we will promptly prepare and announce measures to strengthen complex consultations such as employment support in cooperation with related ministries including the Ministry of Employment and Labor," and added, "We will also devise support measures for those who have fallen into delinquency, and thoroughly prepare for the enforcement of the Personal Debtor Protection Act passed by the National Assembly last year to alleviate interest and collection burdens on delinquent debtors."
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